Fixing Ethical Dilemmas in the Accounting Profession
January 13, 2011
Resolving Ethical Problems in the Accounting Profession
The Dilemma of an Accountant
Baker Greenleaf was one of the Big Eight accounting firms. Daniel Potter was obviously a highly ethical accountant that placed a lot of value upon integrity. He was hired to work as a los angeles accountant for the firm. Baker like a great many other firms was faced with a dilemma that tested the firm's moral standings. Though a firm can be faced with a horrible decision, the firm's ethical standing helps determine the very best ethical decision for each condition. To reach the best ethical decision it is best to use philosophical techniques in addition to the stakeholder impact analysis.
Firms deal with dilemmas daily, which is why it is necessary that staff have a fair understanding of integrity and how that they apply to organization. The study of ethics involves the approaches of principles or standards, which tend to be used in businesses during the decision-making process (Decision-Making-Solutions, 2008).
The application of philosophical strategies and the stakeholders impact examination helps to give attention to the impact the decisions could have on the stakeholders, which help to make sure that the attention is usually not solely focused on earnings but honest aspects as well. Some businesses focus on the amount of earnings whereas a company that implements ethics targets not only the amount of profit although also how that earnings was accomplished (Businessballs, 2006-2010). A business just as concerned about how the profit can be generated since it is about how much profit is more likely to make better ethical decisions concerning the business, stakeholders, and public interest.
The Company, Baker Greenleaf, was confronted with a dilemma when the organization realized that a bank account that it previously shared with another Big 8 accounting organization was faced with a situation that needed a unique audit (Brooks, 2007). Baker was interested in performing this audit confident of gaining the account exclusively. Baker placed this kind of account being a high priority placing the best workers on the accounts.
The account in question was a wholly held real estate supplementary (SUB) that had triggered the company problems in past times (Brooks, 2007). Oliver the project mature put Kemudian in charge of controlling the SUB's audit simply by reaching a clean opinion. After completing the audit, Dan reached a lot of issues of concern, which he managed to accurate except for a single.
The Subwoofer overstated the largest properties on it is balance sheet. The overstatement was substantial and Dan thought the problem needed to be corrected. The total amount sheet respected the property for a much bigger amount than Dan's appraisal. This presented as an issue that Dan believed the matter needed to be addressed with the SUB managers as they recommended a write-down to take care of the miscalculations. The SUBWOOFER managers rejected the write down, which offered a situation for Lalu because in accordance to AICPA regulations in materiality, disagreements amongst the customer and curator affecting the income assertion greater than 3 percent is required to be revealed in the CPA's opinion (Brooks, 2007). The client's balance sheet presented a great overstatement resulting in a $1, nine hundred, 000 write-down, which might present a seven percent difference inside the client's net income.
Dan had no choice but to send his survey and tips to Oliver, which then presented another situation. Oliver did not agree with Dan's suggestions and he wanted Dan to adjust his report to eliminate his findings. Once Dan rejected Oliver chosen to switch the reports additionally to composing Dan up. Dan confronted two problems, creating a write-down to correct the overstatement and reporting Oliver actions of falsifying his report.
A number of parties take part in this situation and stand to get affected in one way or another. Dan is an employee of Baker...
Sources: Brooks, M. J. (2007). Business & professional values for company directors, executives, & accountants (4th ed. ). Mason, ALSO: Thomson Southwestern.
Businessballs. (2006-2010). Ethical leadership, decision-making, and organizations. Gathered from http://www.businessballs.com/ethical_management_leadership.htm.
Decision-Making-Solutions. (2008). Addressing values in decision making. Retrieved from http://www.decision-making-solutions.com/ethics_in_decision_making.html.